The present invention describes a new paradigm for conducting an auction on a remote information server such as the Internet.
The Internet is an extremely powerful tool for conducting auctions. Literally millions of users can simultaneously take part in a single auction. Auction sites such as E-bay have popularized the Internet auctions. Each of these auctions allows bidding between virtually every person who has access to the Internet.
The auctions often last over an extended period of time, e.g. over one week. Many of these auctions use agents which automatically handle the bidding. The bidder instructs the agent with information about the bidder's maximum desired bid. The agent will bid only up to that amount. Moreover, the agent does not immediately bid its maximum amount; it only bids an amount when the price of the item rises to a level that forces the agent to bid in order to keep the high bid.
It has been found that the most serious and competitive bidding can occur at the end of the auction. Conversely, bidding early in the auction tends to cause the product to sell for more money than it would have sold for otherwise. Therefore, people often wait until the last instant, e.g. the last minutes or seconds of the auction, before bidding.
Auction sites such as E-bay often have fixed times for the auction ending. The auction ends at that moment, even if bidding may be most intense at that moment. If a bid is placed, but not received before the instant of the auction end, the item will sell. Therefore, Internet delays can cause a product to sell for less money than it otherwise would have sold for.